Viacom Inc. said Thursday that net income rose sharply in its fiscal first quarter compared with results depressed by a large accounting charge a year ago. But its revenue and adjusted earnings fell because of a drop at its Paramount studio business and lower advertising revenue at its Nickelodeon television channels.
Net income rose to $470 million, or 92 cents per share, in the fiscal first quarter, compared with $212 million, or 38 cents per share, a year earlier. That period included $379 million in charges related to a contract battle with the maker of the “Rock Band” video games, Harmonix Music Systems Inc.
After adjustments, Viacom earned 91 cents a share, a penny above the 90 cents expected by analysts surveyed by FactSet. A year ago, adjusted earnings came to $1.06.
Revenue fell 16 percent to $3.3 billion from $3.95 billion a year ago. But the latest figure was short of the $3.48 billion expected.
Revenue at the Paramount filmed entertainment business fell 37 percent to $975 million, largely because the release schedule. The 2011 period included such hits as “Mission: Impossible — Ghost Protocol” in theaters and a “Transformer” movie on home video. Viacom also saw declines in licensing fees from television shows it produces.
Viacom’s larger business, the television networks such as MTV, Comedy Central and Nickelodeon, saw a 2 percent decline in revenue to $2.39 billion. The company blamed its kid-focused Nickelodeon channels and said U.S. ad revenue would have grown if those channels were excluded.
During a conference call with analysts, CEO Philippe Dauman said Nickelodeon was showing signs of improvement thanks to specials and other event programs. He said the company’s focus now was on strengthening its Saturday morning lineup, its weekday afternoon shows and its preschool viewership — the latter so that young kids would turn into long-term viewers as they grow up.
Meanwhile, Dauman said MTV was looking into diversifying its programs after the end of “Jersey Shore” in December after three years. He said the network was tapping into such themes in youth culture as the complexities of modern relationships. Among them: “Catfish,” an unscripted series about dating in the digital world.
“Jersey Shore was a game-changing hit for TV but it also precipitated an overemphasis on one night,” he said. “We’re now successfully building out additional nights.”
Viacom, which is based in New York, took an after-tax charge of $379 million in the 2011 quarter to cover an arbitration award won by the original shareholders of Harmonix.
Viacom had acquired Harmonix in 2006, but sold it back to its founders in 2010. The founders then sued, claiming that they were owed extra payments for the performance of “Rock Band” during its spell of popularity. They won an arbitration award of $383 million.
Its Class B shares rose 67 cents to $59.99 in morning trading after rising as high as $60.40 earlier in the session. That was an all-time high, according to FactSet.